PartyGaming is capturing headlines once again this week with its market activity. While Americans celebrated their Independence Day on Tuesday, three of PartyGaming's directors sold shares in the company. Furthermore, speculation regarding the object of the company's first sports betting acquisition target has been mounting this week, with Gamebookers identified as likeliest target and Unibet considered a possibility as well.
PartyGaming Finance Director Martin Weigold on Tuesday sold his entire shareholding of 2.7 million shares at their then value of about 116p, netting £3.1 million. Secretary David Abdoo also sold his entire shareholding of 1.7 million shares, which netted him £1.98 million.
Chairman Michael Jackson reduced his shareholding to 600,000 by selling 262,000 shares for £305,000. Jackson, who is said to have sold his shares for tax purposes, also sold 100,000 shares in Sage, of which he is also chairman.
One month ago, the four founders of PartyGaming--Ruth Parasol, Russ DeLeon, Anurag Dikshit and Vikrant Bhagarva--sold a combined 200 million shares, which constituted 5 percent of the company's total issued share capital and raised a total of £232 million. They had actually planned to sell 350 million shares, but market conditions at the time were less than ideal.
The primary consideration affecting the value of I-gaming stocks in early June seemed to be the possibility of prohibiting legislation passing the U.S. House of Representatives. In the month since then, however, the proposed measures--Rep. Leach's, R-Iowa, Unlawful Internet Gambling Enforcement Act of 2006 and Rep. Goodlatte's, R-Va., Internet Gambling Prohibition Act--have not gone before the full House of Representatives. It had been anticipated that the bills would be addressed in the House within two weeks of their passage by the House Judiciary Committee on May 25.
Goodlatte, Leach and their staffers are believed to be working on merging the language of the two bills into a single bill that integrates the different approaches and strengths of each. Passage of Internet gambling legislation is one of the stated goals on House Republicans' "American Values Agenda," a list of 10 family values bills that House Republicans last week said they would like to pass. It is the intention of leadership to pass all of them through the House in July.
As usual, PartyGaming has been a recent driving force in market behavior. Last week the company announced an agreement with Harrah's Entertainment to make its play-for-free PartyPoker.net site an official sponsor for the 2006 World Series of Poker--a deal thought to be worth about £20 million ($36 million). The sponsorship puts the PartyPoker.net logo in the center of every playing table of the 2006 WSOP at the Rio All-Suite Hotel & Casino, which began June 25 and features 44 separate events, including the televised $10,000 No Limit Texas Hold 'Em World Championship Event to take place July 28 - August 10.
PartyGaming also expanded its product offering last week with the launch of a backgammon Web site at PartyGammon.com. Players can download the PartyGammon gaming application and participate in games for fun or for real money by using the same PartyAccount they use to play across PartyGaming's entire line of products. The PartyGammon lobby interface is similar to PartyPoker's, and players can play a variety of gammon versions. The software and application was created completely in-house.
It has also surfaced that PartyGaming has arranged a $500 million loan with Dresdner Kleinwort Wasserstein and Royal Bank of Scotland to fund the purchase of a non-U.S. facing online sports book. The Guardian reported last week that PartyGaming is in negotiations for the purchase of a privately owned European sports book operator and that the company was expected to reveal more information to the public within the next two weeks. The Guardian publication anticipated the purchase price being "relatively small in the context of the fund raising," but that additional sports betting purchases might also be planned for the near future. Rumors abound that Gamebookers is the first sports book that PartyGaming will acquire.
Should PartyGaming venture into sports betting, it is expected that it would not accept sports wagers from gamblers located in the United States, which is home to about 80 percent of its customers.